New Delhi: India’s fiscal deficit for the four-month period (April-July) of the financial year 2026-27 stood at Rs 4.55 lakh crore, which works out to 26.8 per cent of the target for the full financial year, government data released on Monday showed.
This is less than the fiscal deficit in the same period last year, which stood at Rs 4.7 lakh crore, constituting 29.9 per cent of the estimate for the full financial year.
Total receipts in April-July this year stood at Rs 13.07 lakh crore, while overall expenditure was at Rs 17.62 lakh crore. The figures represent 35.8 per cent and 32.9 per cent, respectively, of the budget estimate for the current financial year.
Total receipts in the same period last year were estimated at 31.3 per cent of the budget estimate, while expenditure widened from 30.9 per cent.
Revenue receipts during April-July stood at Rs 12.68 lakh crore, of which tax revenue was Rs 8.45 lakh crore and non-tax revenue was Rs 4.23 lakh crore.
Non-tax revenue typically includes dividends from public sector enterprises such as Indian Oil Corporation, Coal India and BHEL, spectrum-related income, and various fees collected by the government. The dividend transferred by the Reserve Bank of India to the government also forms part of these receipts.
Non-tax revenue jumped as the RBI approved a dividend of Rs 2.87 lakh crore to the Central government, up from Rs 2.69 lakh crore transferred last year. This has strengthened the country’s fiscal position and helped to reduce the fiscal deficit.
Revenue deficit was at Rs 43,645 crore or 7.4 per cent of the fiscal year’s budget target.
The Government achieved its fiscal deficit target of 4.4 per cent in the financial year 2025-26 and has lowered the target further to 4.3 per cent of GDP for the current financial year as part of the fiscal consolidation process.
There is some concern that the rising subsidy bill due to the higher prices of petroleum products and fertilisers, due to the West Asia crisis, will lead to an increase in government expenditure on this account, which could exert pressure on the fiscal deficit.
A decline in the fiscal deficit strengthens the fundamentals of the economy and paves the way for growth with price stability. It leads to a reduction in borrowing by the government, thus leaving more funds in the banking sector for lending to corporates and consumers, which leads to higher economic growth.
